Cathie Wood, head of Ark Investment Management, often takes profits when her favorite tech stocks rally.
That’s what she’s been doing with Palantir Technologies (PLTR), selling shares as the stock rallies ahead of its third-quarter earnings report.
Last year, the flagship Ark Innovation ETF gained 35.49%, far outpacing the S&P 500’s return of 17.88% in the same period. So far this year, Wood’s flagship Ark Innovation ETF (ARKK) is up 11.05% as of Oct. 21, while the S&P 500 surged 13.32%, Yahoo Finance data shows.
Wood gained a reputation after the Ark Innovation ETF delivered a rosy 153% return in 2020. But her style also brings painful losses in bearish markets, as seen in 2022, when the ETF tumbled more than 60%.
Those swings have weighed on Wood’s long-term gains. As of Oct. 21, her Ark Innovation ETF has delivered a five-year annualized return of -6.36%, while the S&P 500 has an annualized return of 11.26% over the same period, according to data from Morningstar.
Cathie Wood remains optimistic about AI and tech revolution
Wood focuses on high-tech companies across artificial intelligence, blockchain, biomedical technology, and robotics. She believes these businesses have strong growth potential, but their volatility often causes fluctuations in the Ark’s funds.
Over the decade ended 2025, the Ark Innovation ETF wiped out nearly $5 billion in investor wealth, according to a report by Morningstar’s analyst Amy Arnott. That made it the fourth-biggest wealth destroyer among mutual funds and ETFs in the ranking.
Wood defended her investment strategy after an audience member at a recent summit questioned ARK’s performance compared with the Invesco QQQ Trust (QQQ).
Related: Cathie Wood buys $11.8 million of tumbling tech stock
“I welcome the question. Investors deserve to understand both their returns and the decisions behind them,” Wood said in a post on X on Oct. 5.
She argued that the ARK Innovation ETF (ARKK) and QQQ are built differently. QQQ tracks the Nasdaq-100 Index, while ARK actively invests in companies it believes are driving disruptive innovation across industries including healthcare, financial services and transportation.
Wood has long been optimistic about AI, which she sees as a major driver of productivity, economic growth, and corporate profits in the years ahead. She has also pushed back against recent fears that AI could pose an existential threat to humanity.
In September, Wood reposted a post by David Sacks on X, saying he makes a good case that the “AI will kill humanity” headlines were orchestrated.
Meanwhile, she acknowledged that AI, like other technologies, can be used for harmful purposes. She said people such as Elon Musk who highlight AI’s potential risks are “doing us a great service,” adding that “half of the solution—including AI—is understanding the problem.”
In August, Wood said U.S. corporate profits remain unusually strong, with domestic profits before tax at 13.2% of GDP, a level she said is near multi-decade highs.
Some of that strength came from the massive monetary and fiscal stimulus during the pandemic, but Wood believes another factor is helping sustain margins today: companies are leaning into AI and productivity gains to protect them.
“I think we’re still early in seeing how far that can go,” she said, adding that companies that use AI effectively will “separate themselves from the ones that don’t.”
Not all investors agree with Wood’s optimism. Over the past 12 months through Oct. 20, the Ark Innovation ETF saw roughly $1.64 billion in net outflows, according to data from ETF research firm VettaFi.
Cathie Wood sells $16 million of Palantir stock
On Oct. 21, 20, 19 and 15, Wood’s Ark funds sold a total of 79,290 shares of Palantir Technologies Inc. (PLTR), according to Ark’s daily trading information sent to TheStreet. These shares were worth about $16 million based on the latest trading price of $201.72.
Palantir shares have rallied this week after falling more than 11% last week amid a broader tech selloff.
On Oct. 19, Palantir announced a partnership with Knox Systems to expand the use of its AI software across U.S. government and defense agencies. The stock also benefited from a rebound in tech shares and optimism ahead of its third-quarter earnings scheduled for Nov. 2.
Related: Cathie Wood buys $17.3 million of surging AI stock
Mizuho analyst Gregg Moskowitz recently raised his price target on Palantir to $245 from $215 while maintaining an Outperform rating, according to The Fly.
The firm updated its software stock targets ahead of third-quarter earnings. Moskowitz said Mizuho’s channel checks were “very healthy overall,” pointing to strong public cloud spending, consumption trends, and continued AI adoption.
On Oct. 8, Goldman Sachs analyst Gabriela Borges upgraded Palantir to Buy from Neutral with a $230 price target. The analyst expects Palantir to outperform through 2027, citing growing demand for sovereign AI, customized applications, and the company’s expansion into specific industries.
Borges said Palantir’s total addressable market “may be setting up for another step function change in depth.”
The firm also noted that Palantir was trading at a discount to companies with similar growth rates after underperforming earlier this year.
In August, Palantir stock saw a single-day rally of 29.45% on August 4, after it posted rosy second-quarter earnings and outlook.
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Adjusted earnings came in at 41 cents a share for that quarter, ahead of analysts’ estimates of 35 cents. Revenue jumped 93% year over year to $1.94 billion, beating expectations of $1.80 billion.
“To my knowledge, no businesses at our scale has even grown half this much,” Palantir’s CEO Alex Karp said in a CNBC interview. He also predicted that the strong growth will likely “go on for at least another 18 months.”
Palantir also raised its full-year revenue guidance to between $8.15 billion and $8.16 billion, up from its previous outlook of $7.65 billion to $7.66 billion.
Wood has been active in trading Palantir stock. She greatly increased her position in 2024 and sold many of those shares in 2025 as the stock climbed. In June, she bought back some shares. Now she’s selling again, likely locking in some gains after the recent rally.
Palantir is not among the top 10 holdings in the Ark Innovation ETF.
Top 10 Holdings in the Ark Innovation ETF by weight as of Oct. 21, 2026:
- Tesla (TSLA) – 10.22%
- SpaceX (SPCX) – 6.47%
- Tempus AI (TEM) – 5.13%
- Circle Internet Group (CRCL) – 5.11%
- OpenAI Group – 4.44%
- Coinbase Global (COIN) – 4.31%
- CRISPR Therapeutics (CRSP) – 4.25%
- Shopify (SHOP) – 3.41%
- Twist Bioscience (TWST) – 3.13%
- Robinhood Markets (HOOD) – 3.07%
Other than buying Palantir shares, Wood’s latest trades on Oct. 21 included selling Amazon (AMZN), Shopify (SHOP), Teradyne (TER), Elbit Systems (ESLT), DraftKings (DKNG), and Personalis (PSNL).
She also bought shares of Pacific Biosciences of California (PACB), Intuitive Surgical (ISRG), X-Energy (XE), Oklo (OKLO), Netflix (NFLX), Scribe Therapeutics (SCTX), Iambic Therapeutics (IAM), and Intuitive Machines (LUNR).
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